A Bush administration plan to crack down on contract fraud has a multibillion-dollar loophole: The proposal to force companies to report abuse of taxpayer money will not apply to work overseas, including projects to secure and rebuild Iraq and Afghanistan.

"I hate to sound cynical, but what lobbyist working for a contractor in Iraq wanted this get-out-of-jail card?" asked Patrick Burns, spokesman for the government watchdog group [Taxpayers Against Fraud].